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Flanders Manufacturing is considering purchasing a new machine that will reduce variable costs per part produced by $0.15. The machine will increase fixed costs by $18,250 per year. The information they will use to consider these changes is shown here.  The following names are to be used when completing this problem: Operating Income Variable Costs Sales Fixed Costs per Unit Selling Price per Unit Variable Cost per Unit Contribution Margin Fixed Costs Operating Loss If Flanders purchases the new machinery, what will be the company’s break-even point in units?  . Use commas as needed (i.e. 1,234). If Flanders purchases the new machinery, what will be the company’s break-even point in dollars?  . Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Assuming Flanders purchases the new machinery, construct a contribution margin income statement for sale of 216,000 units. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Flanders Manufacturing Contribution Margin Income Statement For the Month

Flanders Manufacturing is considering purchasing a new machine that will reduce variable costs per part produced by $0.15. The machine will increase fixed costs by $18,250 per year. The information they will use to consider these changes is shown here.  The following names are to be used when completing this problem: Operating Income Variable Costs Sales Fixed Costs per Unit Selling Price per Unit Variable Cost per Unit Contribution Margin Fixed Costs Operating Loss If Flanders purchases the new machinery, what will be the company’s break-even point in units?  . Use commas as needed (i.e. 1,234). If Flanders purchases the new machinery, what will be the company’s break-even point in dollars?  . Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Assuming Flanders purchases the new machinery, construct a contribution margin income statement for sale of 216,000 units. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345). Flanders Manufacturing Contribution Margin Income Statement For the Month

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 2BE: Contribution margin Waite Company sells 250,000 units at 120 per unit. Variable costs are 78 per...
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Flanders Manufacturing is considering purchasing a new machine that will reduce variable costs per part produced by $0.15. The machine will increase fixed costs by $18,250 per year. The information they will use to consider these changes is shown here. 

The following names are to be used when completing this problem:

Operating Income Variable Costs

Sales
Fixed Costs per Unit Selling Price per Unit

Variable Cost per Unit
Contribution Margin Fixed Costs

Operating Loss
  1. If Flanders purchases the new machinery, what will be the company’s break-even point in units?  . Use commas as needed (i.e. 1,234).
  2. If Flanders purchases the new machinery, what will be the company’s break-even point in dollars?  . Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
  3. Assuming Flanders purchases the new machinery, construct a contribution margin income statement for sale of 216,000 units. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
    Flanders Manufacturing
    Contribution Margin Income Statement
    For the Month
       
       
       
       
       


  4. Complete the following contribution margin income statement to properly reflect the break-even information given in the problem. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345)
    Flanders Manufacturing
    Contribution Margin Income Statement
    For the Month
       
       
       
       
       
Current Units sold 216,000 $ Sales price per unit Variable cost per unit Contribution margin per unit Fixed costs Break-even (in units) Break-even (in dollars) 2.15 1.75 2$ 0.40 $ 56,000 140,000 $301,000 Sales Variable costs Contribution margin Fixed costs Net income (loss) $464,400 $378,000 $ 86,400 $ 56,000 $ 30,400
Transcribed Image Text:Current Units sold 216,000 $ Sales price per unit Variable cost per unit Contribution margin per unit Fixed costs Break-even (in units) Break-even (in dollars) 2.15 1.75 2$ 0.40 $ 56,000 140,000 $301,000 Sales Variable costs Contribution margin Fixed costs Net income (loss) $464,400 $378,000 $ 86,400 $ 56,000 $ 30,400
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